I This document constitutes the base prospectus of ... - Volksbank AG

8.3 Czech Republic
The following text is merely a summary of certain Czech tax aspects and consideration relating to the Securities
that does not purport to be a comprehensive summary of all tax-relevant aspects that may be important
from the perspective of deciding on a purchase of the Securities. This summary does not describe any tax
aspects resulting from the laws of any other state than the Czech Republic. This summary is based on the legal
regulations effective as of the day of this Prospectus and may be subject to a subsequent change (including
potential retroactive results). Future assignees of the Securities should consult with their legal and tax advisors
on tax, legal consequences of the acquiring, owning and disposing of the Securities and the receipt of
payments of interest and other forms of yield on the Securities under the tax and foreign exchange regulations
in effect in the Czech Republic and the countries in which they are residents as well as countries in which
incomes from holding and selling the Securities may be taxed. The following summary is based on the assumption
that the Certificates qualify as securities within the meaning of Czech law and that the revenues
from the Certificates do not qualify as interests or dividends.
8.3.1 Czech income taxation
8.3.1.1 Tax Residents Individuals
The payments of interest accruing on the Securities to individuals with unlimited income tax liability in the
Czech Republic holding the Securities as a non-business asset are subject to taxation in the Czech Republic.
If interest is paid out by a Czech tax payer, then such payments are subject to withholding tax of 15% in 2009;
no additional income tax is levied over and above the amount of tax withheld (final taxation pursuant to Section
5(5) of the Czech Income Tax Act 1 ).
The difference between the nominal value of a bond 2 and its issue price at the time of issue is considered to be
interest income from capital pursuant to Section 8 of the Czech Income Tax Act, subject to withholding tax at
rate of 15% in 2009 (note that in the case of repurchase before maturity the redemption price shall be taken
into account instead of the nominal value).
Where the interest is made on Securities originated from sources abroad or the income on difference between
the nominal value paid for a bond and its issue price at the time of issue is originated from sources abroad,
this gross income (including tax withheld abroad) not reduced by connected expenses shall be included in tax
base subject to general 15% tax in 2009.
Capital gains (i.e. the difference between the sales price and the acquisition price of Securities increased by
related fees for trading in the capital market and costs spent in connection with the sale) realized upon sale of
one or more Securities are, in 2009, subject to income tax at a general 15% tax rate pursuant to Section 10 of
the Czech Income Tax Act (if not exempt - see below). It should be noted however that if capital loss is incurred
from the sales of Securities in the taxation period, the decrease of the tax base by such loss will not be
possible.
Capital gains from the Securities sold after the lapse of a six month period following their acquisition might
be exempt from personal income tax pursuant to Section 4(l)(w) of the Czech Income Tax Act only if the total
direct share of the seller in capital or voting rights of the issuer has not exceeded 5% during last 24 months 3 .
1 Act No. 586/1992 Coll., on Income Tax, as amended.
2 The Notes are likely to be considered as bonds within the meaning of Czech law.
3 The condition in respect of the total holding interest applies only for securities purchased after 1 January 2008.
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